Imagine a Firm Has a Temporary Surplus of Cash Meant

question 127

Multiple Choice

Imagine a firm has a temporary surplus of cash meant to fund an expansion project in the next nine months. Which of the following statements is correct?

• A) The firm will probably want to invest this in preferred stock.
• B) The firm will probably want to invest this surplus in U.S. Treasury bonds.
• C) The firm will probably want to invest this surplus in U.S. Treasury bills.
• D) The firm will probably want to invest this surplus in whichever security yields the highest return.

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